Consulting Spotlight

Michael Bernzweig (00:03.18)
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I'd like to welcome everyone to this week's edition of Consulting Spotlight. And today we're joined by Sal Trabasi from CFO ProPlus Analytics. And with that, Sal, welcome to the podcast.

Salvatore Tirabassi (00:19.949)
Michael, thank you for having me. Really appreciate it.

Michael Bernzweig (00:22.144)
Yeah, Noah, we're really excited and I can see we've already had a bunch of questions come in from the audience and I wanted to make sure to start by having you give us a little bit of a peek behind the scenes and a bit of a understanding of your journey, getting to where you are and letting our audience know what you do there at CFO ProPlus.

Salvatore Tirabassi (00:48.259)
Sounds good. Yeah, so I'm a native New Yorker born and raised in Brooklyn.

After college, I was a management consultant, then went to grad school and spent about 15 years in two growth equity partnerships doing basically venture capital style investing. More later stage businesses, generally speaking. And after those two stints, I got into the operating world and became

a CFO for a consumer services business that I spent about nine years there. And then in early 2024, I started this business, CFO ProPlus Analytics. And really the goal of the business was to bring a methodology of CFO work that

is extensible into businesses that are, you know, from startup to about a hundred million of revenue, basically giving them a service offering and service stack that they might otherwise have hard time getting similar results with in the general hiring marketplace. Because we're focused really on a

on a methodology and a process that applies to a lot of different businesses. And we try to bring this high level capability and deliver it very tactically within these organizations and get them way ahead of the curve on where they might otherwise be if they were trying to build out full finance functions on their own. Typically, this comes in the form of what's called fractional CFO services. But behind that word for us is this

Salvatore Tirabassi (02:51.243)
met our methodology, which is based on three main things. One value creation orientation. So it's all about how to build more value in the business for the owners. The second piece is due diligence readiness, which means always being prepared to talk to third parties about how great your business is so that if you need to raise capital from a bank or from a partner that wants to come into the business, you're providing

very clean, digestible, useful information about the dynamics of your business. And then the third thing is a single source of truth on data. This applies mostly to slightly larger companies, but what we try to do is make sure that all the information that the organization is using to make decisions, operationally or financially, are all coming from a vetted source that everybody agrees is the...

is the real source of that information so that there's no miscommunication with people interpreting data differently, which can really slow down the effectiveness of a management team. So we focus on those three things at a high level, and then we do all this work behind it.

Michael Bernzweig (04:04.886)
I love it. love it. And it sounds like a, you know, having a methodology like that. And it sounds, structured from a very academic standpoint where you really have vetted sources for each point of truth within what you're doing. It sounds like it can really scale. It's almost somewhat industry agnostic agnostic and can scale across organizations from different, industries.

Salvatore Tirabassi (04:26.756)
Wait.

Salvatore Tirabassi (04:31.983)
Yeah, yeah. And that's what I what I meant when I said it's extensible to a variety of businesses. I mean, typically this kind of thinking, you know, I think is ingrained in the top CFOs that you'd find that really great companies. Maybe they'll articulate it slightly differently. But, you know, by distilling it into those three things, it makes it extensible to pretty much any industry, because everybody should have those same objectives as a business.

And then it's also the size of the business, which I think the kind of the innovation that we try to bring is that in a business that's, you know, three, five, 10, 50, a hundred million of revenue, you may not have the access to CFO talent and the ability to fund the supporting organization. Right. Because it's just because you hired the CFO doesn't mean you've got a full high quality

finance team, you've got to have really good people in the different seats and the bigger you get, the seats will increase. what we do is we bring this high level thinking that's really focused on what are the right things for any business and we can deliver it into that segment of the market who might otherwise not really encounter the types of people that can deliver it at that.

at the stage of the business that they're at.

Michael Bernzweig (06:03.778)
And it's exciting because I think a lot of organizations struggle with just this. know, the founder is probably great at whatever it is that they do. And, know, now assembling a team of the right executives that have the subject matter expertise in every area at an organization that may not have the revenue to support full-time positions for the best in each area.

makes a lot of sense. I think it's something that, where was it years ago? I think it's really exciting thing.

Salvatore Tirabassi (06:41.103)
Well, think remote work has helped make this more possible. Although I have met a couple of fractional CFOs who've been doing it for a long time on a regional basis with more in-person work. it did exist for, it has existed. just, think now, you know, it's called, it has a name, right? Fractional CFO. But it's existed for a while now, but I think that the whole remote work,

Michael Bernzweig (07:02.989)
Yeah.

Salvatore Tirabassi (07:11.467)
innovations that have happened because of COVID really help companies now be able to extend their net and find the right fit for them from this standpoint and not have to worry about that person necessarily being on site. I mean, we do go on site, you know, if needed, especially for like important planning meetings and that kind of stuff. But, you know,

On the note about the founders, one thing that, and I can give a little anecdote on a pitch that I recently did, it's interesting with some of these early stage companies that are raising seed and kind of pre-seed seed, maybe not necessarily pre-seed, but seed stage, series A type investments. had a fractional CFO who's been doing it for a while once tell me that

what he's discovered over doing this for 18 years is the words founder and CFO are not used in the same sentence early enough in the business process, in the business building process. And when they, when they are used, it's really well past the due date. So, so, so, so I think, I think that,

Michael Bernzweig (08:20.972)
Yeah.

Michael Bernzweig (08:25.198)
Sure.

Michael Bernzweig (08:31.316)
Yeah, no, absolutely.

Salvatore Tirabassi (08:39.181)
What's nice about the fractional CFO model is you're not overburdening them with costs at that stage. Really at any stage that the fractional CFO is used, it's always less expensive than the full-time CFO plus the team. So it really is a benefit financially, but it comes with a lot of horsepower.

Michael Bernzweig (09:02.254)
Yeah. And, know, I think what's really interesting to me, and I think a lot of the listeners as well, you know, clearly your perspective, you know, everyone on your team obviously is well seasoned, but from your end of it, leading the organization, you know, you have over two decades of experience and everything from marketing, you know, in the early days through to private equity.

and obviously the CFO services at this point. So you really have an interesting trajectory of your personal career and a foundation with, you know, but not to, to, to.

to say anything other than, obviously, you know, having a background from Harvard and Wharton and some of the other traditional institutions and some of the understanding of methodologies that just work across other organizations, you're really bringing a very unique perspective to what you're doing. So with that said, are there organizations

Salvatore Tirabassi (10:10.509)
Yeah, thank you.

Michael Bernzweig (10:15.426)
that do benefit from fractional services such as this and is there a point at which they've outgrown it?

Salvatore Tirabassi (10:25.591)
Yeah, I would say that any.

business owner that is looking to scale. And generally what I see is, I'm not gonna talk about the venture-backed companies. Maybe we'll get into that, but I'm just talking more about.

people who have been building their own businesses, maybe they've got a little bit of a, they've got a credit line at a bank, but they've built a business and they're scaling it. They're going from like five to 10 to 15 million of revenue. Typically, you know, they're starting out with accounting, right? And the real need for them though to grow is not the hindsight, which is very important that accounting gives you, but it's really the...

being able to take that and interpret that into what's going to happen next. And that's a combination of having strategic conversations with the founder and owner, being involved in the marketing and sales meetings, understanding how the business is going to generate more new business and how it's going to retain its existing customers. And then the finance team basically helps build that out into obviously financial projections.

high quality projections, I should add, that are directly connected to the accounting system, provide you with budget versus actual reporting with a lot of interpretation and the ability to turn that into high quality presentation material so that you can share it with third parties and look extremely professional and knowledgeable about your business, right? Because when you're talking to third parties,

Salvatore Tirabassi (12:11.981)
You really want to show that you understand your business and you know how to communicate it in a very effective way that would be meaningful to the third party. it's a customer, a potential investor, a bank that wants to do an SBA loan with you, for example, you know, all these constituents want to know about your business. And what happens is they're starting out with accounting. And often what I've seen is they just try to take the accounting information.

and present something, but there's a big disconnect between just what's in the accounting system versus telling the story that you wanna tell. And in between those two bookends is the whole finance function and management helping to manage the business. So if you're doing the work in between, you should have an end result that allows you to have great reporting, great financial forecasting.

strategic interpretation of where the business is headed so that finance can help you grow it. So it's really those types of businesses that I think can benefit the most. I found that owner operators also, because they have so much skin in the game, they really get the message quickly when they have a conversation with us. They know what their pain points are.

Michael Bernzweig (13:37.486)
So I'm gonna ask you a question because I see a few different people in the audience have asked the same question. as far as what are the warning signs an owner should look for that point them in the direction of, yeah, I need to get somebody aboard in this position fractionally sooner rather than later.

Salvatore Tirabassi (14:03.513)
That's a great question. I mean, it varies from company to company, but I would say that working capital is usually the main driver in a lot of owner operator businesses. They know that the transactional cash that's passing through the business is the lifeblood of what they're going to do to grow the business in the following month and then the month after that. And

You want to have a really good handle on that and the way you do that is you really understand what your projections look like from a revenue standpoint and what your cost projections look like and sometimes like for example, you know with some clients I go in and or we go in and we create a weekly cash flow model for them as like a first step and people, know, lot of a lot of modelers would say

you know, just generically speaking, I model a monthly model is generally what I do. But on a cash basis, we take it down to a weekly level because that really exposes the cash, the transactional cash that's available in the business to keep the business spinning and turning and producing more profit and growth. So typically it's the working capital and cash flow.

projections and we try to bring it down to a weekly level if needed. Sometimes the business is pretty stable and they don't need to look at it at that level and you can look at it monthly. But on the venture capital side what I find is that they don't really have a want for working capital because typically they've raised a few million dollars that are sitting in a in a money market account or some

some cash management account where they're trying to max out the interest on it while they figure out how to build their business. But they're really focused on what's the runway, how do I extend the runway, and in that instance, excuse me.

Salvatore Tirabassi (16:14.049)
sneeze once more. Okay. In that instance, the entrepreneur who received the venture capital, what we help them think about is, okay, what is the high value investment that you're making that's going to get you to nearer term revenue generation?

And are you balancing the investments you're making in your technology or your services so that it's matching where we think the market should be for product market fit so that you have the ability to go to market for real near-term revenue? And then that's all factored into this formula to try to extend the runway, right? And obviously as they grow revenue, it makes them worth more so then their next round of funding will be a possibility for them.

Michael Bernzweig (17:05.966)
And hopefully, hopefully before they have accepted venture capital, found their product market fit or at least heading in a very good direction that they can.

Salvatore Tirabassi (17:06.211)
So it's a little bit different with those guys.

Salvatore Tirabassi (17:15.395)
Well, when you're in a seed deal, you usually you're trying to figure that out. You you have a hypothesis and you you're working really quickly. Well, I would say in a pre seed, you're probably trying to figure that out. In a seed, you're more trying to now scale it up. Yeah, yeah.

Michael Bernzweig (17:19.992)
Yeah.

Michael Bernzweig (17:27.532)
Yeah. Scale it. Yeah. Yeah. That's interesting. So I guess every, you know, client is different, but, what, what is a typical, you know, team look like that you're sending into an organization? Is it specifically a CFO or are there other

components to the team behind the scenes working within your organization or that are working in their organization working with you?

Salvatore Tirabassi (18:03.47)
Yeah.

Yeah. So let me just start. So the name of my company is CFO Pro Plus Analytics, which is, you know, it's not just a CFO business. It's got this plus analytics piece to it. And when I mentioned the three principles of the methodology, the first one was value orientation. Then we had due diligence readiness. And then we had

you know, single source of truth, everybody working from the same data. Well, the single source of truth piece really feeds due diligence readiness and it also feeds value creation orientation. And I just want to mention that because we provide CFO services and we also combine that or separately sell analytic services where we build.

business intelligence systems for companies that are a little bit more sophisticated. And then we'll help operate those systems and provide a whole other layer of insights and innovation opportunities for them with the information that we generate out of those. So when we have a typical client engagement, it's either starting, it's usually starting on the CFO side. And when we do the CFO service, are, if it's a,

single product company with a reasonably reliable bookkeeper, we can just slot in a CFO and they can handle the financial planning and analytics work, build the financial forecasting and reporting, and then work directly with the CEO of the company. If there's more complexity to it or they don't really have a good accounting function, then we can kind of step down with the CFO and pair them up with an FP &A person and or

Salvatore Tirabassi (19:56.367)
an accounting resource. Then you've got clients that start just on the analytics side where they basically get a business intelligence analyst to stand up their system and make recommendations. Typically that's a one to two person team that specialize in analytics and analytics interpretation for operational

strategy decisions. And then you've got clients that take both packages or start from one and then also take the other one or start from CFO and then take analytics. And in that case, you've got probably one or you've got probably two people on the CFO side. These are more sophisticated businesses. So you typically have two people on the CFO side and then initially a couple of people on the analytics side. And then eventually once you get that system up and running one person on the analytics side and we

layer on top of the existing team, right? Our goal isn't necessarily to replace people. It's to fill holes that don't exist at a very efficient, with a very efficient value proposition. And then we enable a lot of other people in the organization with the work that we do.

Michael Bernzweig (21:17.422)
Great, and obviously early on as an organization is scaling, are different solutions that you're providing along the way, but what type of solutions or how do things change as an organization becomes more mature and they have different needs?

Salvatore Tirabassi (21:41.133)
Well...

Salvatore Tirabassi (21:44.783)
Typically as they get more mature, they're either adding more revenue streams to the business and That starts to introduce more complex financial forecasting and reporting Because you might have different Individuals responsible for those different revenue streams And even if you don't have different individuals

The logical thing to do is to look at those things at a driver level independently and really understand how they are each going to grow within the business. So that's one of the things that typically changes. Another one is if the business scales, but they don't add additional revenue lines, they do want to push into sort of departmental budgeting and they get more sophisticated with

you know, where's the information coming from? Are there different heads of departments that are going to participate in the budgeting and planning process? And then there's always the question of like, well, we then when we produce the financial results, how are we sharing it with them so that it's meaningful to them? That's another thing that happens as you scale. A third thing is you might introduce a an investment partner into the business, either debt or equity.

and they're going to have their own financial reporting requirements. And you need to adapt and adjust for that. As well as whatever, particularly if it's an equity partner, what kind of input are they going to have? If they're on the board, how often do they get to review financial statements? Do you want to have investor meetings with them and help them understand the business as you're building it?

and then even maybe take some of their feedback and include that as new assumptions or opportunities in your financial forecasting. So those are typically the different ways that the business gets more complex and our input starts to change with the business over time as a result.

Michael Bernzweig (24:03.266)
And I would think that organizations considering taking on equity, you've seen the good, the bad and the ugly. So you obviously can advise, you know, based on.

Salvatore Tirabassi (24:13.327)
I've seen a lot of equity deals and debt deals.

Michael Bernzweig (24:17.558)
Yeah, and it's so easy to get deluded down to nothing, so it's really important for each rep.

Salvatore Tirabassi (24:23.405)
That is one for sure. think if you have the luxury of picking the right partner because you're in a hot space or your business is doing really well, figuring out who it is that you want to spend the next few years with, that's an important consideration. Obviously, valuation, the terms on which the funds are coming in, how big of a round do you want to raise?

My view is always like, take the capital when you can get it, especially if you need it to grow. then obviously you want to understand the terms around it, but if you've got a good deal on the table or a decent deal and somebody's willing to add 20 % more capital to it, that's a very important analysis to do because having extra capital

I don't know anybody that went out of business or didn't weather tough times, wasn't better able to weather tough times when they didn't have more capital in the bank.

Michael Bernzweig (25:32.448)
And I guess that's a good question. for bootstrapped organizations versus organizations looking to take on debt versus equity, can you kind of give just a quick high level overview of your thoughts on each on strategies?

Salvatore Tirabassi (25:51.312)
And you're saying bootstrapping being one strategy?

Michael Bernzweig (25:52.558)
Yeah, so if an organization is growing organically and they kind of dropped to get to where they are and they may or may not specifically need to take on debt or equity, how do you advise an organization like that? I know there's a lot of complexity to it, but you know,

Salvatore Tirabassi (25:58.67)
Yeah.

Salvatore Tirabassi (26:14.135)
Yeah, no, I think, I mean, I love looking at bootstrap businesses. I've got a few of them as clients now. And I think what's really important about those, and it's one of the areas that we're very helpful with, even if they're on the bigger side, and they've got a little bit more of an analytical focus on the business, is, you if you're gonna bootstrap, it's all about the payback on your customer acquisition.

And if you are bringing in clients efficiently and you can turn those into a revenue in a short period of time that doesn't consume all of the working capital that you've got, you can turn that business on a bit of a flywheel over and over again and continue just rinse and repeat on the customer acquisition.

Now, obviously there's external factors that might slow you down, like if the economy or the sector that you're in is going through a bad period. But generally speaking, if you are bootstrapping it, it's really focusing in on how much does it cost me to get a customer? How long does it take me to get a customer? And then when I get them, how long does it take for me to...

generate enough cash for that customer to go out and get another one. That's the fundamental key to bootstrapping in my world. And obviously, you are factoring in all of the expenses on the revenue, right? So you are looking at like, I'm bringing the revenue in and then when it all flows through the business and I've done my bootstrapping for that month, how much do I have left?

Michael Bernzweig (27:51.95)
Sure.

Salvatore Tirabassi (28:06.635)
how much of that is going to be able to go in to get the next set of clients, right? And that's the thing you want to put on rinse and repeat. Yeah.

Michael Bernzweig (28:10.848)
And then obviously the lifetime value of your customers and all of that. And then for those organizations that are concerned with taking on equity partners but considering taking on debt, how do you look at that scenario?

Salvatore Tirabassi (28:25.955)
Well, focusing in on this sub 100 million revenue type businesses, on the debt side, depending on what type of business model you have, there are some interesting debt sources and the B2B debt market has really evolved in the last decade into a bit more sophistication.

And so if you're an inventory-based business, a really attractive way of growing your business with debt is to get an asset-backed loan for your receivables and your inventory. There's a pretty robust market for that. Once you're over, call it 30 million of revenue, you can really just go to a commercial bank and get something that more or less

function similarly and you can work with a commercial bank on it, but sub 30 million of revenue, there's a pretty robust ABL market. I think that's a good place to look. If you're not an inventory-based business, I know a lot of people are trying to build recurring revenue businesses these days. If you've got contracted recurring revenue, you can just Google contract-based revenue.

debt or recurring revenue lending or something like that. And you'll come up with like a whole slew of lenders who focus on contract-based lending.

Michael Bernzweig (30:00.343)
Yeah, so many.

Michael Bernzweig (30:06.926)
And I guess I'm not trying to imply that these three are mutually exclusive because some debt, some equity, everything is important. I guess on what was still on the debt topic, how do you help young founders who may not be so savvy and familiar with debt? How do you advise them in terms of exploring personal credit versus business credit when taking on debt?

Salvatore Tirabassi (30:38.788)
Well...

Salvatore Tirabassi (30:42.831)
in various pockets of this debt market, even if you get business credit, it may go back to you personally. So that's always like a big decision, right? In that instance, what I would advise an entrepreneur is, what other sources of capital do you have available to you if you don't wanna take personal risk on this? And it might be worth

taking into consideration, you know, like if they have, if they've been in the housing market for a little while and maybe have some equity in their home, you know, that might be a reasonable place to go get the credit basically off of their own personal balance sheet and put it into the business, as opposed to going to a third party, taking the personal risk anyway, and having sort of less control, or maybe you're not sure and you want to baby step into it.

and you can do a little bit out of your home equity. You could also get a reasonably large credit line perhaps personally that's unsecured, obviously more expensive. And I think you can trade those off against each other.

Michael Bernzweig (32:04.31)
And it's interesting, I mean, there is definitely no lack of debt available, but I guess, you know, just making the right and cautious decisions, especially for young business owners just getting up and running. Do you have, while we're still finishing up on debt, do you have a few tips in terms of establishing?

business credit early on as an organization is growing and may not have a whole bunch of track record.

Salvatore Tirabassi (32:36.845)
Yeah, you know, it's interesting. A fair amount of the business credit lenders do look at the longevity of the entity. if you just kind of dive in and you go online and you sign up and get an LLC,

You're starting the clock, so start the clock as soon as possible. There is also, I've never done this, but I know that it exists. There's also the ability to go out and purchase a pre-existing LLC that has more history to it, which may or may not.

give you the age credibility that you need. So I'm not necessarily recommending that as a path. I'm just saying that age of the entity really does matter to a lot of these lenders. And so when you start up right away, don't expect to go out and get a business credit line right away.

Michael Bernzweig (33:47.116)
Yeah, to the age of the entity and open up your banking relationships on day one.

Salvatore Tirabassi (33:52.939)
On day one, yeah, go right away. Pick a good shop around for the banking relationship. Don't just go to a big name off the bat. I know Amex is trying to get into the business market and their checking systems are not that.

great and you can't really even add a savings account right now. you know, does come with, you know, once you start showing some revenues going into your account, they do give you some decent credit on a credit card.

Michael Bernzweig (34:33.666)
Yep. And I think it's also very interesting, know, just my personal experience, I've seen the larger banks, you know, jump in and out of sectors, you know, as the wind changes. obviously having a close relationship with your banker and close relationship with the size of bank that you want to engage with is important.

So now onto equity. Talk to us a little bit about your feedback on taking on equity.

Salvatore Tirabassi (35:05.699)
Yeah, think I'll couch that in two different ways. Let's say you got a bootstrap business that has done well. And I've got an instance of this with one of my clients. But they've really have maxed out what they can do with the debt in the business.

There, I, and this is exactly the conversation I had with the entrepreneurs who run that company. You know, I talk about the fact that in order to continue to grow, they need permanent capital in the business, not capital that with debt where you have to, you know, pay it off every month. And so you're growing, but it's also taking capital away from you. And then you have to grow a little bit faster to keep ahead of the debt.

Michael Bernzweig (35:50.093)
Right.

Salvatore Tirabassi (35:59.979)
and also be able to fund the growth and the customer acquisition and all this stuff that I spoke about earlier.

And so then that what I say to them is that that's good capital to have. know, I might say to them, you have a good partner, they like working with you. The results are great in the business, the lender's happy. But if you want to go faster, you need permanent capital. And permanent capital means somebody comes in and buys a piece of ownership in the business. You put the capital in and then you can kind of use that to continue to grow. And it makes your your

it could make the effectiveness of your debt financing even more effective. Because then what you can do is you can grow faster and then get to a point where you're turning the business over on itself. And now the lender can actually lend you more. So that's one view. And then the other view is, I just have a startup idea and

I want to go out and raise equity for it. think there you're looking at it. I pre-seed? Am I seed? And you got to have a really strong and convincing message.

Not a whole lot of information necessarily. But your idea should be flushed out with some good thoughts behind it and also in terms of how big of a market it could be and how it will make money. Those are critical concepts to know like the back of your hand. And then you've got to get out there and just...

Salvatore Tirabassi (37:55.715)
you know, meet as many seed and pre-seed investors as you can to be able to raise the equity. Networking is essential there too. So it helps definitely if you come out of a successful venture-backed company or you are coming out of a specific industry or product category where you know there's this opportunity for innovation. Those types of things, you know, typically, you know, help you raise

the early stage capital because your know-how and your relationships contribute to the credibility that you have when you meet with these early stage investors.

Michael Bernzweig (38:39.958)
And for our audience, so they can really appreciate what you and your team are doing. Can you give us an example of an organization that you've worked with and what life looked like before and after you became engaged?

Salvatore Tirabassi (38:56.867)
Yeah, let me...

Michael Bernzweig (38:59.342)
because I think it's always helpful to have.

Salvatore Tirabassi (39:02.095)
Yeah, so I have a client that is basically kind of like a marketing agency. the before was...

Bootstrapped, good turning of the flywheel in the business, able to generate more business on a periodic basis with the funds that they were generating from their sales.

a quote unquote bookkeeper on staff, very messy books, not a good bookkeeper. So after, what does it look like? The after is we cleaned up all their books, got all their taxes filed, which were late. This is when we first showed up, right?

built a full financial forecast that's really tied to the mechanics of their business and ties directly into, in this case, this client uses QuickBooks, is mapped accurately to how the results come out of QuickBooks so that every month we have a very detailed review of budget versus actual, where did the money go, where did we do well, where didn't we.

conversations around bringing in some debt capital is the after. In the instance of this business, firsthand experience, actually talking to some of the recurring revenue lenders that were out there, not enough history for them to get comfortable. It's probably something more like beginning of 2026 that would be more likely for them. Another piece of the after is that this client

Salvatore Tirabassi (41:00.047)
was very interested in

grabbing onto the fundamental business drivers and KPIs on a recurring basis so that the financial strategy work and reporting and conversations we were doing with the executive team and the executive team here is really just three people. It's a nice size business, but it's very efficiently run.

They wanted to have more KPIs and live operational data to help make their decisions when they're having staff meetings or budgeting meetings or client acquisition meetings. And so we then they hired us to build out a BI platform for them, which is part of the after. So we expanded the scope of services for them from just CFO to include analytics.

which was really great for us as a business, but I think super valuable for them. mean, in the case of the analytics function for the price that we're charging them, they could hire, we were like a 60 % discount to them hiring just one senior analyst.

Michael Bernzweig (42:07.298)
That's really neat, yeah.

Salvatore Tirabassi (42:33.847)
Right. And so, but we build out the whole system for them and then we operate it for them and we come in with the results. So in that instance, you know, they didn't have enough work to be done with one senior analyst. And also the senior analyst may not be able to build the system for you. And we just deliver the whole thing with all of the data interpretation. You know, like when my head of analytics shows up to talk about operational analytics with them, it's a very serious conversation. You know, this is...

Somebody with a, there's another person with like a warden MBA and like 20 years of experience who's, and what we can do in two hours of work would take potentially somebody else eight hours to do.

Michael Bernzweig (43:19.406)
I'll share with you. My mom was an entrepreneur at heart and she always said hire the best and they're not going to learn on your dime. So that's absolutely, absolutely true. But so I want to wrap up by asking a couple of other questions that I see coming in. So as you're working with organizations that are growing, particularly in SaaS or maybe the direct to consumer sectors,

Are there any common challenges that you see across different organizations?

Salvatore Tirabassi (43:54.287)
Wait, sorry, could you repeat the question?

Michael Bernzweig (43:56.95)
Yeah, so as you're working with organizations that are growing, particularly in SaaS or direct to consumer where they may have inventory, are there similar challenges that you see across these different organizations that are common elements?

Salvatore Tirabassi (44:12.983)
Yes, yes, definitely. I think cash flow management is very common. If you're in an inventory-based business, it's all about the timing between your sale and collection of receivables versus re-upping your inventory. There's also, depending on what type of an inventory-based business you're running, there's also the effect of seasonality, which puts

different kind of pressure on the cash flow. But if you have like a recurring revenue SaaS business, it's also a cashflow management exercise, but it's a little bit different. It's not about, you know, filling the buckets of inventory and then figuring out how quickly they move and then how you replenish. But it's how do I collect revenues as quickly as possible from this client? And then am I able to reinvest it into the next cohort of clients that I want to sign up? So cash flow,

Modeling is very consistent. I would say tax planning and we don't do the tax work, but we act as like an entrepreneurial advisor about the main issues that are going to come up when you have a solid tax CPA come in. And so we help prep them on that. We make sure that the books are clean. We help them understand like, when you, you know, are taking people out for business meals, you know,

Be cognizant of the fact that it's only 50 % deductible. There's certain things that they don't, simple things like that that you can kind of explain to them. Depending on how the business is structured too on the tax side, there's the opportunity for the owner to have, depending again, how they structure it, their own retirement funding coming out of the business that could be tax advantage for them. So we can talk to them at a high level about those.

options. That's one consistent thing that happens. It's probably less important with venture-backed companies. It's more for owner-operator businesses. And I would say getting them out of the cash accounting mindset also and helping them understand like, this is tax. We're talking mainly about cash here. This is forecasting the business. We're talking mainly about really true gap accounting here.

Salvatore Tirabassi (46:38.467)
And that's all in the vein of being due diligence ready. If an investor comes in, you want to show them gap projections. When the tax folks advisors come in, you want to be able to show them the correct presentation of the financials for tax purposes. So those are like three of the things that come off the top of my head.

Michael Bernzweig (47:03.224)
Yeah, no, and that's helpful. And I'm sure, you know, for a lot of the organizations, while they may not realize it at the outset, you know, staying compliant, having the right guidance. And at the end of the day, I'm sure you're bringing more dollars to the bottom line for many of these organizations and their spending on fees. So that's obviously the ultimate ultimate goal. So

Salvatore Tirabassi (47:26.529)
Yeah, I would say when we're working on working capital, not even when, but just by establishing a methodology for handling working capital and customer acquisition, we demonstrate a lot of value to the business in terms of being able to make more money.

Michael Bernzweig (47:47.906)
That's great. And this was a great deep dive. think we may have even gone in a little bit deeper than we both expected, but I think that brings a lot of value to the community. I really first off want to welcome you to the Software Oasis Experts Community. I know you've joined the community and we'll leave a link in the show notes for anyone.

Salvatore Tirabassi (48:05.667)
Yeah, thank you. Yeah.

Michael Bernzweig (48:14.446)
that would like to reach out and discuss some of the different offerings that you have over there at CFO ProPlus Analytics. And once again, Sal Trabasi from CFO ProPlus Analytics. Thanks for joining us on Consulting Spotlight this week.

Salvatore Tirabassi (48:33.965)
Michael, thank you for having me. I really appreciate it. It was great talking to you.

Michael Bernzweig (48:38.966)
Same here. You know what?

Salvatore Tirabassi (48:39.983)
Bye.